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Tesla history: The journey from electric car dream to Elon Musk’s behemoth

Melody Hahm
Senior Writer

Whatever you think about Tesla (TSLA), it often hinges on how you feel about a single person: South African-born billionaire entrepreneur Elon Musk.

But contrary to popular belief — and the company’s own website — Musk is not the original founder of Silicon Valley’s first automobile manufacturer.

Martin Eberhard and Marc Tarpenning, two American engineers, founded an early e-book company called Rocketbook in 1997. They sold the company for $187 million and then reunited to co-found Tesla in 2003.

Named after Serbian-American inventor Nikola Tesla, the company was initially fueled by Eberhard’s love of speedy two-seaters, interest in battery technology and concern over climate change, he and Tarpenning embarked on building an electric sports car.

Eberhard was Tesla’s first CEO and Tarpenning its CFO.

In the early 2000s electric cars were far from mainstream. General Motors had just scrapped the prototypes for its electric vehicle, the EV-1. And given Tesla’s lofty dreams, they were in desperate need of financial backing.

Tesla’s origin story is a fascinating one, even before Elon Musk took over. (Photo: Yahoo Finance)

That’s where Elon Musk came in.

Musk, founder of SpaceX and co-founder of Zip2 and PayPal, helped get Tesla off the ground with an initial investment of $6.3 million in early 2004. He also became chairman of the board.

In the video above, we detail Tesla’s origin from a Silicon Valley electric dream to the unwieldy behemoth carmaker that it is today.

Melody Hahm is a senior writer at Yahoo Finance, covering entrepreneurship, technologyand real estate. Follow her on Twitter @melodyhahm.


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